One of the major changes in the Copyright (Infringing File Sharing) Amendment Bill was the replacement of ISPs with something new called an IPAP. The reasoning appeared to be that it was unclear when the obligation to maintain mappings of IP addresses to users (i.e. one of the duties of an ISP) kicked in. The new definition added various exclusions and inclusions that determined whether you were an IPAP or an account holder.

What this hid from view was that if you weren't an IPAP, then you must be an account holder. And, as an account holder, you became liable for everything done through that account. In fact, it's easier to think about the implications of the bill this way:

Whoever is named as holding the last publically identifable address is liable for all infringement attributed to that address.

You can only escape this liability (and become an IPAP with all of their obligations) if you meet all of the following tests:

Provide any form of digital communications to someone else

Allocate an IP address to that person or organisation

Bill the person or organisation

Are primarily in the business of providing such services

Are providing your services to fixed users on a continual basis, not on a transient basis

Approaching it from this point of view makes it easier to see what obligations and exposures you have.

Who is liable?

A public library providing Internet access terminals fails to meet points 4 and 5. This means they are liable for all infringement by anyone who uses their terminals.

An airport that provides free wireless Internet access to passing travellers fails to meet points 3, 4 and 5. They are liable for any copyright infringement by anyone passing through the terminal using their wifi.

I have a server from a hosting provider to that I pay for. Since the hosting providers meets all of points 1 through 5, they have the obligations of an IPAP, and must forward notices to me. I am liable for any infringement made through my server, for example, after the server is hacked into and software installed on it without my knowledge.

If you share an internet connection with your flatmates and your name in on the account? You don't meet point 4, so you are liable for any infringement by your flatmates.

As the law is currently written, can any business or person risk giving Internet access to someone else?